Despite a weak U.S. dollar that makes their goods more expensive and hampers competitiveness, Italian farm equipment manufacturers look increasingly to America to increase sales and profits.
“The United States is the market for the future,” says Pier Silvio Mayer, managing director of Sovema, a manufacturer of tillage, hay and mowing equipment in Modena, Italy.
Sovema, along with just about every other significant equipment maker in Italy, displayed its wares in November at the 35th EIMA(International Agricultural and Gardening Machinery Manufacturers Exhibition) trade show in Bologna.
The show is sponsored annually by the National Union for Construction and Agricultural Machinery (UNACOMA).
More than 1,800 manufacturers displayed 22,000 models during this year's exhibition, according to UNACOMA figures.
Mayer says Sovema counts on exports for 70 percent of its annual sales. “The European market, the other 30 percent, remains stable,” he says, “but we don't see as much potential for growth.”
In addition to the United States, New Zealand, Australia and Japan offer potential for growth. “We have some difficulty because of the currency differences,” Mayer says. “It's all tied to the U.S. dollar and that affects profit potential.”
European currency, the euro, recently reached all-time high rates compared to the U.S. dollar. That imbalance makes Italian exports more expensive.
“But the market is in good shape,” Mayer says, “so we will stay in and wait for a better exchange rate. We are currently changing our organization in the United States and will soon go straight to dealers. We will continue to push hard in the United States.”
He says providing the right product for the market remains a key to success. “We've made changes for the U.S. farmer. We modify hay rakes and other implements to meet their requirements.”
Sovema serves the North American market with two branches, one In Memphis, Tenn., and one in Winnipeg, Canada. “From Memphis, we sell mostly into Tennessee and Kentucky, but our goal is to expand into other areas of the United States.”
He says the TD FM 180 flail mower is Sovema's newest implement for U.S. farmers.
Maschio USA, along with sister company Gaspardo, also expects to change its mode of operation in the United States to work directly through dealers from a branch in East Moline, Ill. “By going dealer direct we hope to avoid overlap,” says Andrea Maselli, vice president for corporate sales. “Business has been booming the last four years and we've doubled our export market since 1993. We're looking for a U.S. partner.”
“We expect to expand U.S. sales,” sales Patrick Reid, general manager for Maschio-Gaspardo, USA.
The firm hopes to find markets for a new 27-foot rotary tiller, a tool they believe will work well in vegetable production.
“We were the first to introduce a folding rotary tiller into the United States market,” Maselli says. “It's a 16-foot long unit that folds down to 7 feet, the width of a tractor.” He says the unit is easier to move than rigid systems and farmers control it from the cab.
“We've also modified the size of vegetable planters to meet needs of U.S. farmers. Units go up to 36 rows or down to just one and will operate behind 50-180 horsepower tractors.”
“The U.S. market remains promising,” Maschio says.
Maschio manufactures soil preparation equipment and Gaspardo builds planters and seeders.
The United States is the No. 1 market for Tonutti, a farm machinery manufacturer in Remanzacco that specializes in hay equipment.
“Business in the United States continues to be very good,” says Thomas Ressig, export manager. “We introduce new products every year.”
Tonutti also works out of a Memphis facility.
“We stay in touch with farmers,” says Carlo Tonutti, general manager of the 140-year old company. “It's important to be close to our customers to identify their needs.”
Tonutti says his company was the first to introduce V-rakes into the United States. “And three years ago we redesigned a rake to improve adjustments for windrows. The operator can use either a crank, hydraulic or electronic system.”
He says farmers are pushing for electronic controls for tools. “It's easier for them to make changes in the field. Electronic controls are more comfortable and more efficient. Controlling adjustments from the tractor seat saves labor and time.”
“We think we have an advantage with new products every year,” Reissig says. “Farmers look for something new.” He says Tonutti will introduce a new finishing mower into the United States market in 2005.
Tonutti says the hay market remains sound in the U.S. “Demand for beef is strong and that helps the market for hay equipment. We also see a strong demand for high quality roughage for beef cattle. Higher market prices for beef also help.”
Ressig says Tonutti exports account for 98 percent of the company's business.
“We want to compete with the best,” Tonutti says. “That's why we're in the United States. And we're no longer joined with partners, so we are free to develop new products on our own.”
Company spokesman Adelmo Giovannini says the United States provides a big market for Enorossi hay equipment, “especially rakes. We've been in the U.S. market for many years,” he says.
Giovannini says the company, based out of Perugia, exports 60 percent of its products to the United States. “Exports account for 90 percent of our business,” he says. “We sell a lot in Europe as well as into North Africa. We are not the biggest player in the American market but we are trying to increase sales and hope to grow.
“We hope to acquire a company with manufacturing facilities in the United States.”
The clod in the furrow for expansion, as with other manufacturers, is the weak U.S. dollar. “We expect the euro will stay high against the dollar for several more months,” he says.
Paola Zama, managing director for FALC, Faenza, Italy, says the U.S. market accounts for about 20 percent of the company's business. “We export all over the world and about 80 percent of our business is out of Italy. Europe is our biggest market and the old USSR offers new sales opportunities.”
He says shredders and spaders may offer the best potential for U.S. sales.
“Shredders have a place on corn, rice, sunflowers and cotton farms,” he says. “Spaders work well in vegetable production.”
He says a big shredder, a 27-foot wide unit, should have a good fit in the United States. “U.S. farms are bigger and tractors are bigger,” he says. “And they need high quality, strong machines.”
He says most U.S. farmers use vertical shredders. “Ours works better. We've had a good market in Northern California, not as much in the central states.”
He says FALC has some machines operating in Texas. “In dry conditions, on units without a closed gearbox (The FALC unit is.) run a higher risk of fire. We pay a lot of attention to safety, reliability and service after sale.
Checchi and Magli
“The United States is our most interesting market,” says Claudio Zarri, of Checchi Magli, a Budrio, Italy, a vegetable production technology company.
He says the U.S. vegetable industry offers a good market for a transplanter. “We've had good response to improvements we've made in our machine,” he says. “We've introduced it into the California market.”
Zarri says Checchi Magli will create machinery specific to a market. “We make big, strong, efficient machines and we're testing prototypes for strawberry production in the Salinas Valley.”
Zarri says he's happy with the company's U.S. success so far but wants to expand. “The United States represents about 8 percent of our business, which relies on exports for 75 percent of sales. We've only been in the U.S. market for five years, mostly in California, Arizona and Nevada. The weak dollar is hampering business.
“We have a small dealer in Pennsylvania handling mostly small, one to two-row units, mostly to small farmers. We want to push that market into the East Coast and south into Georgia and Florida. We also see potential in the Lower Rio Grande Valley in Texas.”
He says transplanters represent a small niche market. “We want every machine out of our factory to be just what the farmer wants. For the U.S. market, that usually means bigger. In Europe, a six-row transplanter is a big machine. In California, a 10- to 12-row transplanter is usual.”
Zarri says large growers are willing to invest in large, well-built transplanters. “In California, some growers plant strawberries four times a year,” he says. “In Florida, they plant twice a year.”
Checchi-Magli's newest offering is the Dual 12-2000 transplanter, for large farms.
No-till farming has been slow to catch on in Europe, but a new planter, the Prosem K, from NARDI, an equipment manufacturer in Piano, Italy, offers new features that could attract converts.
“It's a unique planter,” says company spokesman Alfred Turchetto.
The no-till seeded is based on the Prosem vacuum planter, which features an innovative metering unit. “It incorporates a seed disk fixed magnetically, without seals and without wear,” Turchetto says. “The vacuum chamber rotates together with the disk.”
He says the metering unit insures maximum precision for seed spacing, “even at high speeds.
“It also has a wear-resistant cutter between two disk openers to provide a wedge-shaped furrow.”
Turchetto says test results in Spain have been promising. “We've done in-field tests for five years without problems,” he says. “No-till planting is a new concept to Europe and acceptance has been slow. Adoption in southern Spain has been better because of milder temperatures.”
Turchetto says the no-till planter works for corn, sorghum, sugarbeets and sunflowers. We see some potential for cotton in Southern Spain and Greece,” he says. “We also hope to sell into the Unites States.
Tortella's reputation for supplying rugged, efficient, long-lasting equipment emerged from the origins of the company, established in 1949 to build equipment for farmers in a mountainous region on the east coast of Italy.
“We're one of the oldest manufacturers in Italy,” says Maria Rosa Bankston, company spokeswoman, “and we build strong, sturdy equipment to stand up to rocky land.”
She said the company, located in Ortona, developed several products, including cultivators, flail mowers, mechanical combines, spading machines, power harrows and shredders.
“Spaders are our pride and joy,” she says. “These tools work differently than a plow. A plow damages the soil, but a spader softens it up and makes it more tillable. It's a good choice for areas with poor drainage. It's particularly useful in vegetable production because vegetables need good drainage and good soil structure. It is popular with organic farms because it mixes residue into the soil very well.”
She says Tortella exports spaders into Australia and New Zealand and into the United States through a British Columbia distributor. “We'd like to find other distributors in the United States and we plan for a network of representatives to cover more territory.”
She says spaders are not difficult to sell and that opportunities for the U.S. market seem promising.
Bankston says U.S. producers also offer opportunities for flail mower sales. “Recent burn bans may help. Flail mowers work well in orchards.”
Tortella is testing a new implement with multiple attachments. “It has one frame that can accept a rotary cultivator, a flail mower and a disk. Orchard managers can use it between trees. It should be well-adapted for a large grower and may allow them to reduce the amount of chemical weed killers they spray between the trees.”
Company spokesman Antonio Cableri says the Oliviero, a “whipper for olive trees with a high mechanical performance that allows extensive penetration into tree canopies without damage,” has promise for small to medium U.S. olive growers.
He says the best opportunity is in California, but also sees potential in Texas and Florida. They big advantage for growers, he says, is reducing harvest costs.
“Harvest accounts for 60 percent to 65 percent of the total cost of producing olives,” he says. “Mechanization can drop that cost to 15 percent to 20 percent.”
The Oliviero, produced by Agri Tec, in Manciano, works on a rechargeable battery. “The unit is light and is easy for anyone to use,” Cableri says.
He says mechanical harvest actually improves quality. “The machine causes no damage to the olives and no damage to young branches. Growers can look for more consistent yields.” He says the olive oil industry is growing in California.